Hoeft & Wessel : Höft & Wessel AG lived up to expectations in Q1 2015 - Droege Group acquires entire bank loans

Höft & Wessel AG lived up to expectations in Q1 2015 - Droege Group acquires entire bank loans

Hannover, May 5th, 2015

With its substantially improved performance in the first quarter compared with the previous year, the Höft & Wessel Group is making substantial progress in its course of consolidation after a difficult year in 2014. At EUR 14.4 million, consolidated sales revenues were up EUR 2.7 million or 22 % on the same quarter of the previous year (EUR 11.7 million). Accordingly, the Company lived up to expectations in the first quarter and is systematically continuing its optimisation efforts. This generally satisfactory performance is reflected in the particularly encouraging business of the Metric segment and the growth in the Höft & Wessel segment compared with the previous year.

The Höft & Wessel Group also matched expectations with respect to operating result. At EUR -1.3 million, operating result (EBIT) improved by EUR 2.6 million over the same quarter in the previous year. Here as well, the subsidiary Metric Group in Swindon (UK) achieved positive performance: With a positive operating result of EUR 0.2 million in the first quarter, it proved that the resolute continuation of optimisation efforts is achieving sustained results.

In addition to the increase in sales revenues, the positive trend in operating result was underpinned by a reduction in the cost of external staff in development and project management. These costs came to only EUR 0.5 million in the first quarter, down EUR 1.1 million on the comparable prior-year period. This reduction in additional external resources is due to the successful completion of numerous legacy projects in 2014. The entire Group is headed in the right direction with this improved cost structure.

The Höft & Wessel Group's order receipts stood at EUR 12.1 million in the first quarter of 2015 and were, thus, virtually unchanged over the previous year. As of 31 March 2015, order books are thus valued at EUR 51.2 million, down roughly 4 % on 31 December 2014. Obviously, Höft & Wessel Group's business performance in the medium to long term hinges on its ability to gain new projects and customers.

Volume production of the new-generation almex.mobile 2 commenced in April 2015, after the conclusion of the first quarter. Among other things, Deutsche Bahn will be using this device as a mobile terminal for train attendants. Consequently, deliveries will commence in the second quarter of 2015 with a corresponding effect on sales revenues. Similarly, Höft & Wessel is in the final phase of completing the fourth-generation skeye.allegro LSi mobile data recording devices: testing with software partners and customers commenced at the end of April, with a mid-year roll-out planned.

Höft & Wessel have strengthened their human resources with the recruitment of additional trained staff. The fact that highly-qualified developers, who enjoy strong demand in the employment market, are opting for Höft & Wessel as their employer testifies to the Company's appeal and its favourable prospects.

After the end of the quarter, Droege International Group AG (principal shareholder) indirectly acquired all of the Höft & Wessel Group's bank loans of EUR 8.5 million on 30 April 2015. With the acquisition of the bank loans, the Droege Group is sending out a strong signal to the Höft & Wessel Group's customers, partners and employees, demonstrating the confidence that it has in the Company's favourable strategic and operating performance.

"This transaction underscores the principal shareholder's long-term commitment, "says Thomas Dibbern, CEO of Höft & Wessel AG, adding: "This gives the staff and us as the Board of Management the necessary stability and basis for the Company's long-term successful growth."

About Hoeft & Wessel

The Hanover-based Hoeft & Wessel Group with its locations in the United Kingdom and in the United States is a leading solutions provider and service partner for data capture, validation and processing systems. The product portfolio includes ticketing systems, mobile terminals for data capture, and car park systems. Hoeft & Wessel has linked its fortunes to the global trend towards greater mobility, and its systems contribute towards more efficient processes in the transportation of passengers, goods and services. The Company's customers include Deutsche Bahn and FirstGroup, as well as leading retailers in Europe. The principal shareholder of Hoeft & Wessel AG is the company Droege International Group AG (www.droege-group.com), based in Düsseldorf, Germany.